Correcting the Record
on Blackstone and
Correcting the numerous falsehoods and
mischaracterizations in Aaron Glantz's recent
book that references Invitation Homes and Blackstone
Aaron Glantz did not reach out to Invitation Homes or Blackstone for comment and ignored our repeated efforts to speak with him before publication – violating one of the cardinal principles of journalistic fairness. If Glantz had been willing to talk with us, we would have told him we are incredibly proud of the positive impact our investments had on local communities.
Invitation Homes provides an important housing option for families seeking to rent quality, updated homes near good schools and good jobs. With Blackstone’s help, the company began purchasing homes in 2012 that were sitting vacant and dragging down property values for surrounding homes since the financial crisis. Invitation Homes then made those houses available to Americans who either need to rent or want to rent. The company has invested more than $2 billion, an average of $22,000 per house, in upfront renovations to its properties. Those investments not only benefit Invitation Homes’ residents, but also played a critical role in stabilizing local housing markets, and spurring local economic growth and job creation in areas that were especially hard hit.
While Invitation Homes is a very small part of the overall US housing market (approximately 0.1 percent), it is playing a positive role in addressing the broader undersupply of housing in the communities it serves. In nearly all of its markets, it is more affordable to rent than own a home. For example, in Southern California, it is $818 less expensive per month to rent. In Seattle, it’s $759 less expensive per month. By expanding the availability of rental housing in its communities, Invitation Homes is increasing residents’ options and offering more affordable housing choices in areas where many people want to live.
Moreover, Invitation Homes has very high occupancy levels, renewal rates, and customer service ratings – indicating the vast majority of residents are having a positive experience with their homes. This is in great part because professional firms such as Invitation Homes can deliver higher levels of customer service than non-professional landlords. The significant resources, technology, and maintenance teams that Invitation Homes is able to deploy are helping raise the bar for customer service throughout the industry.
Invitation Homes has a 96% occupancy rate, and residents renew their leases and stay twice as long as the apartment industry. Its business depends on satisfied residents, so that will always be their primary focus. While even one resident issue is one too many, their renewal rate and resident satisfaction scores demonstrate the vast majority of residents are having a positive experience. According to the most recent data, their residents gave them an average satisfaction score of 4.5 out of 5.
The argument that the professional single-family rental industry is having a negative impact on the overall housing market, rents, or first-time home buyers is not supported by the facts. Despite all the attention on this industry, it is a very small part of the market and has virtually no impact on these issues – which are dictated by broader market factors.
Invitation Homes represents only 0.1 percent of the nearly 93 million single-family homes in the United States and just 0.5 percent of the nearly 16 million single-family homes for rent in the United States. Indeed, there have always been a significant number of single-family home rentals even before the financial crisis – as evidenced by the small share of the market owned by professional rental companies such as Invitation Homes. The pace of buying by professional single-family rental companies has also fallen significantly in recent years – with Invitation Homes actually being a net seller of homes in many recent quarters.
Invitation Homes has virtually no ability to impact broader rent trends in its communities. Invitation Homes operates in some of the most competitive housing markets in the country, and it must follow market prices or no one would rent from Invitation Homes. Indeed, Invitation Homes charges rents in line with the broader market – otherwise it wouldn’t have such high levels of occupancy (96%).
The homes Invitation Homes bought required substantial rehabilitation and capital expenditure (approximately $22,000 per home). This is not the same market as first-time home buyers, who typically do not want to take on a home that requires such significant repairs. What’s more, the notion that a company that represents less than 0.1 percent of the single-family homes in America is having a significant impact on this market is not based in fact.
Invitation Homes is in the business of housing families – eviction is never a course they want to pursue. It’s extremely disruptive and costly for all parties. That's why they seek to carefully pre-qualify their residents before they sign a lease. And if a resident falls behind, they work with them to find a solution to help them get back on track that will keep them in their homes. Eviction is always – always – a last resort.